IRS: Bitcoin is property, not currency

Image credit/info link here. (Note: this links to a Bloomberg summary/background on Bitcoin for people like me who are fascinated by Bitcoin but find the concept very hard to grasp. I strongly suggest you read this prior to commenting.)

This week, it was announced that Bitcoins would not be treated as property for taxing purposes. The Internal Revenue Sercice (IRS) will apply the rules that currently regulate stocks and barter transactions to Bitcoins. This marks the first substantive ruling from the IRS concerning Bitcoins. According to a Bloomberg report, this could reduce the volume of transactions conducted using Bitcoins. Charles Allen, the chief executive officer of BitcoinShop Inc., released a statement following the IRS's announcement. He commented, "“The implications this decision will have on the Bitcoin ecosystem are far reaching, and will be burdensome for both individual users of Bitcoins, Bitcoin-focused business and for the general adoption of virtual currencies."

According to the same Bloomberg article mentioned in the previous paragraph, Bitcoin investors will now be treated like stock investors. For example, if a Bitcoin is held for more than a year and is then sold, it will be taxed at the lower rate applicable to capital gains. The United States also allows investors with losses to subtract capital losses from any capital gains.

Zooming out from the Bitcoin tax issue, it's also interesting to consider the opinions of some well-known, trusted experts. A couple of months ago, U.S. Federal Reserve chairman Ben Bernanke gave his "cautious blessing" to Bitcoin in a letter to the Congress. On the other hand, American investor Warren Buffett, also known as one of the wealthiest men on Earth, opposes Bitcoin, calling it a "mirage" that is best avoided. (You can also check out venture capitalist Marc Andreessen's criticism of Buffett and an address of those criticisms here.)

A couple of ideas to consider:

1. Given what we have learned about taxes, do you think the IRS is wise to categorize Bitcoins as property, not currency? What are potential pros and cons of this?
2. Bitcoin doesn't have a central bank. In what ways does this liberate the Bitcoin system?
3. What is your take on Ben Bernanke's "cautious blessing"? What is your take on Buffett's "mirage" statement?

A fun cartoon from the New York Times explaining Bitcoin here.
Additional Christian Science Monitor link
Want to test your Bitcoin knowledge? Take this quiz by the Christian Science Monitor.

Calif. State Senator Leland Yee asked to resign following charges of conspiracy to deal firearms and wire fraud

Image from the Associated Press/San Francisco Examiner [file photo] (link here).

There are a lot of details emerging about this occurrence. The articles linked provide the full story and I did my best to summarize it below and present the most crucial points in this developing story.

According to court documents unsealed Wednesday, California State Senator Leland Yee (District 8: San Francisco and San Mateo County) solicited campaign donations in exchange for introducing an undercover FBI agent to an arms trafficker. Senator Yee was arrested yesterday. Prior to his arrest, Senator Yee was known for his California gun control efforts, crusade against violent video games, and transparency bills. For more information on Yee's various transgressions, check out this LA Times article.

It's interesting to observe not just the aftermath of Yee's arrest (he was released yesterday after posting $500,000 bail this Mercury News article reports) but the reactions of the public as well as his peers. The Mercury News compiled an interesting assortment of tweets from people responding to Lee's indictment (see it here). More importantly, Lee withdrew from California's secretary of state race and has apparently shaken up the dynamics for that campaign. Additionally, California's other state senators stood together in asking for his resignation (watch the video here).

In addition to hearing your reactions, I'm eager to get your opinions on the legislation ensuring government transparency that Yee was (ironically) dedicated to. You should also feel free to comment on his various legislative actions pertaining to violence in video games. You may find some helpful information on his official site.

Speaking of women's rights ... the Hobby Lobby contraception debate

Image source here. (Justices Sotomayor, Ginsburg, and Kagan, respectively)

The Supreme Court held oral arguments for Sebelius v. Hobby Lobby Stores, Inc., AKA the Hobby Lobby case, today (SCOTUS blog link). In a nutshell, the Hobby Lobby case examines whether or not the rights of employees to choose and obtain birth control trumps employers' rights to religious freedom. Under the Affordable Care Act, employers are required by law to provide their employers with health insurance that also covers the cost of contraception (a potentially burdensome cost without insurance). However, the powers-that-be at Hobby Lobby disagree with this principle. The owners of the 602-craft store chain (over 13,000 employees) are Southern Baptists and have expressed their views that certain types of birth control go against their own moral principles. Therefore, they believe Hobby Lobby should not be required these forms of birth control under its insurance plans.

According to this article from the New Yorker, the Court's three female Justices made their opinions clear during today's oral arguments. Of the first 32 questions directed at Paul Clement (Hobby Lobby's lawyer), 28 of them came from the female Justices (the article shows the full breakdown of the questions). Taking the perspective of female employees, the three female Justices each pointed out fallacies in Hobby Lobby's position. One I found particularly interesting was Sotomayor's question about employers who have religious objections to health plans that cover other basic medical procedures — blood transfusions, immunizations, medical products that include pork. The other Justices all asked powerful and thought-provoking questions, which can be read in the New Yorker article.

Some ideas to consider: Whose side are you on, Hobby Lobby's or Sotomayor's/Kagan's/Ginsburg's? Do you think the female Justices are acting in a biased manner, or do their arguments sound logical regardless of gender bias? What other cases pertaining to First Amendment rights can this be connected to? What could be some ramifications if the Court ruled in favor of Hobby Lobby or the other way around?

More helpful background on the case and a very amusing photo of Scalia courtesy of U.S. News and World Report here.

Listen to NPR's story on this case here.

Click here for a column by a Fox News correspondent regarding why corporations need religious freedom.

Happy birthday, Gloria Steinem!

Image credit/copyright information available here.

Gloria Steinem, a prominent feminist and political figure, turned 80 years old today. Steinem gained notoriety in the 1960s and 1970s as a leader of the women's liberation movement and is still an active lecturer, writer, and organizer for various women's issues.

In honor of Steinem's birthday, several major news sources compiled photos and articles she has written throughout her time as an activist. This column from CNN caught my attention in particular. It uses her birthday to bring up an increasingly current topic: feminism in 2014. With celebrities like Beyoncé and Sheryl Sandberg proclaiming themselves to be feminists, a lot of Americans are reconsidering what it means in today's society and how that definition varies from person to person.

To tie this back to government and our knowledge on civil rights, it's also interesting to examine the changes that have occurred since Steinem began her efforts in the 1960s. Obviously, a critical development in women's rights would be the Equal Rights Amendment, which was introduced in the 1970s and is still seeking to be ratified by the states. We've also observed new interpretations of the Equal Protection Clause and the implementation of Title IX.

How do you define feminism? Is there a negative stigma attached to being a "feminist"? Do you support increased legislation guaranteeing equality for men and women? What are some pros and cons to enacting legislation that would guarantee equality? Is it necessary?

Time's Steinem highlights

Steinem's website 

Putin isolated after U.S. allies agree to boycott Group of 8 meeting in Russia

This cartoon is by Stuart Carlson and was published on the Christian Science Monitor's website on March 24. It can be accessed here.

On Monday, March 24, Russia was effectively suspended from the Group of 8. In addition, the seven other member countries warned that they would impose more severe sanctions (more info on that here) if President Vladimir Putin were to expand his military presence in Ukraine. Russia, however, dismissed this move as unimportant, stating that the G8 is simply an "informal club."

To backtrack, the Group of 8 comprises eight of the most power, industrialized nations globally. In addition to the United States and Russia, France, Germany, Italy, the United Kingdom, Japan, and Canada are also members. Each year, the Group of 8 meets to discuss global issues such as energy, terrorism, and the global economy. According to this briefing on the Group of 8 by the Council on Foreign Relations, Russia has always been the odd-ball of the group. In addition to being the most recent addition to the Group of 8 (it was added in 1998 following some nudges from U.S. President Bill Clinton), it has always stood apart from the others based on its economic and political structures (neither of which really align with their Western counterparts). Since Russia has been slipping back in the direction of a more autocratic government and Russian leaders have raised concerns over their continued support of Syrian President Bashar al-Assad, Russia's membership in the G8 has been more contested than ever.

As the Washington Post article points out, there would be considerable repercussions if Russia's energy and banking sectors were to be targeted through sanctions ("Several European nations import more than 90 percent of their energy from Russia, which has used natural gas exports to apply political pressure in the past"). Given this information and the rest of the sanction information discussed in the other Washington Post article, what concerns or opinions do you have? On a slightly different platform, what are your opinions on the Group of 8? Is it effective based on its past actions and does it have the potential to affect change this time? Should it replace Russia with a new member? Should it expand at all?

Additional NY Times article
Old but interesting Telegraph argument for expanding G8

Redskins Owner: We're Going To Support Native Americans ... But We Still Like Our Name

The Redskins owner has commented that he is going to do all he can to keep the teams name the Redskins. The organization is often criticized for the name, since it can be considered to be offensive. Sydner, the owner, says "provide meaningful and measurable resources that provide genuine opportunities" for Native Americans. The announcement gave no financial details. Supposedly, most Native Americans don't mind the name, along with the bundle of 3,000 coats donated to them by the Redskins, as Sydner visited 26 tribes the last 4 months. So does his actions justify the commitment of keeping a name found offensive to some? 

Over 3,000 high schools have changed their name to not be associated with derogatory term. Yet 1,000 still remain, including our neighbor, the Jefferson High School Indians. Stanford University also, used to be known as the Indians.

I find it hypocritical that the Redskins say that they are supporting Native Americans yet are still committed on keep their discriminating name. They say that they are just trying to keep a tradition but how can that be justified when your teams name is immoral. But is it really discriminatory? What is the background of this specific name and many others? Who is actually hurt by this? Do you think that organizations should be allowed to pick the mascot they want because they have freedom of speech? Or is it do bad that they should be restricted in their mascot pool? 

Link 1: http://www.huffingtonpost.com/2014/03/24/redskins_n_5025175.html
Link 2: http://profootballtalk.nbcsports.com/2014/03/24/daniel-snyder-forms-native-american-aid-organization-remains-committed-to-redskins-name/

Tragic Ending to Missing Plane

The missing Malaysian plane was just found. Unfortunately, it was discovered that the plane had crashed somewhere in the Indian Ocean. It is very unlikely anyone survived.

This is just so sad to me. To wait for so long and then find out that your loved ones died, would be crushing.  The Guardian states that some relatives of the Chinese passengers accused Malaysia and the airlines for deceiving them and the world about the search. Do you think that this is a legitimate accusation?

Image Source

It is not known why the plane crashed. Some suspect pilot suicide. According to CBS Local, "The plane’s disappearance has baffled investigators, who have yet to rule out mechanical or electrical failure, hijacking, sabotage, terrorism or issues related to the mental health of the pilots or someone else on board." 


So what do you think about this situation? Do you think that the world could have done anything differently to find the plane sooner? Is this a case of bureaucratic failure, or human incompetence or just plain back luck?

Source

Muslim Brotherhood Trial: Egypt Court Sentences 529 Morsi Supporters To Death

An Egyptian Court recently sentenced 529 members of a Muslim BrotherHood to death on charges of murder. Yet not all the members were involved in the alleged killing of two police officers and attack of a police station. So how come all the supporters of the movement are being sentenced to death? The government may be desiring to make a statement to those who oppose their religion and beliefs. Killing 529 people without just cause can be considered genocide.   The government has labeled the Brotherhood a "terrorist group." However,  The Brotherhood calls themselves a peaceful group. While it has been proven than some members of the group have been involved in unjust crimes, the other certainly to not deserve this punishment. The Brotherhood has been accused on other occasions of burning down Christian churches, tearing down Sufis Shrines, and sidelining the military. So the government has countered this. There's is a religious war going on in Egypt and many neighboring countries. So do you think that the Egyptian government has the right of sentencing a so called terrorist group to death? Do you think that supporters of a "detrimental" group should be punished?

Link: http://www.huffingtonpost.com/2014/03/24/muslim-brotherhood-trial-egypt_n_5019909.html?utm_hp_ref=mostpopular#slide=2715774

Ethics and the Internet

The Internet complicates everything, and biomedical research is no exception.

Image Source

Here is the summary (and please excuse my rather matter-of-fact summary of what is a very sad and difficult case). A young kid (Josh) had suffered from multiple bouts of cancer. He had incurred an infection, and was dying. There was an experimental drug that could help him. His parents started a huge campaign to get the drug company to give Josh the drug. The campaign was successful, and Josh is doing better.

However, other people were not able to get this drug, people who did not resort to the Internet for help. Is it wrong that Josh got the drug and they did not? Were Josh's parents smart, or were they "cheating" in a way? It is hard not to be happy that a kid is going to live. Yet how do we decide who gets such experimental drugs and who does not? If it was based upon money, that would hardly be fair. Is it right, though, to use the Internet in such a fashion?

This reminds me of the Heinz dilemma we learned about in AP Psychology. Heinz's wife was sick and dying. He could not afford the medicine that would make him better. The drugstore would not lower the price. Should Heinz steal the medicine?

Just as in the Heinz scenario, what is important is not so much what answer you give, but the reasons behind your answer. So I am curious to hear your thoughts on this issue.

Source

Fan with perfect NCAA bracket missed shot at $1B prize

One man had a chance of winning the 1 billion dollar perfect prize, he predicted Syracuse to be beaten by Dayton, and Mercer beating Duke. It was honestly insane that he made it this far with the ridiculous amount of upsets that have happened so far this year. Yet this weekend his dreams were crushed when Stanford upset Kansas. Now no one is in the running for the jackpot this year. Even if you are not in college basketball you know about the "bracket" and have likely created one in APUSH. Obtaining a perfect March Madness bracket is less likely then getting the winning power ball ticket.  For those out there with brackets, or even without I wanted to ask a couple of questions relating to behavioral economics. Do you think that if you won the 1 billion dollar prize that you would have long-term or short-term happiness?

http://www.foxnews.com/sports/2014/03/23/fan-with-perfect-ncaa-bracket-missed-shot-at-1b-prize/

The Price of College Sports

A return to the world of the economics of sports. This time, college sports. A recent Washington Post-ABC News poll found that only 33% of Americans support paying college athletes. Some argue that universities can spend millions of dollars on coaches, so they can pay for athletes. Others argue that athletics are part of the college experience, and players do it because they enjoy paying, not to get paid.

Image Source: Austin Chronicle

From an economics standpoint, there is now basically a price ceiling on the amount colleges can "pay" athletes, since they can only provide scholarships. If colleges could pay students, do you think there would be more competition over student-athletes? At what price do you think equilibrium would be reached?

So what do you think, should student-athletes be paid? If so, how much and should it be based upon performance?

Source from Washington Post

Small Business, Joining a Parade of Outsourcing

There is a online marketplace where small business owners can outsource programmers to do things like design their own websites., This has recently been becoming a trend for the small business because of one primary reason. It's cheaper!
If you were a business own that might seem like a great thing since you get to save money, and the opportunity cost of finding a programmer in the United States may cost more and take more time because they maybe more busy or something like that. Regardless, it's cheaper and the freelance programmer from a low-income country gets paid more than they would if they got hired from someone within their own country.

So why could this be a bad thing if the two parties trading are both fairly getting what they want? Well one of the negative externalities is the United States economy could be hurting as result of this action. My question is do you think this is hurting or benefiting the United States? Could the GNP be affected by these actions? And would you outsource

Article: http://www.nytimes.com/2014/02/16/business/small-business-joining-a-parade-of-outsourcing.html?ref=smallbusiness&version=meter+at+5&region=FixedCenter&pgtype=article&priority=true&module=RegiWall-Regi&action=click

The Economics of Starbucks

I thought this was interesting. Starbucks has announced that they are planning on selling more alcoholic beverages later in the day. This is an effort to increase sales in the afternoon and evening.

Image Source

In economic terms, what do you think of this decision? Is there enough demand for alcohol to justify Starbucks' sales? Do you think that the sale of alcohol will drive down demand for other products? Starbucks is a common spot for everything from interviews to studying. Would an increased sale of alcohol change the "atmosphere" of Starbucks as a coffee/tea/hot chocolate place? Starbucks probably gets a lot of people who sit there for a couple of hours and only buy one few dollar drink, so it may be to their benefit to sell higher-priced alcohol.

BBC Article


And for your amusement, here is an Onion article from a while ago about Starbucks (Note: The Onion is a satire website. It's articles are not to be construed as accurate depictions of real events).
 Onion Article

Argentina's Economic Crisis

For centuries, Argentina was considered one of the most developed South American countries. With a strong economy, it was considered a rival of the U.S., and Buenos Aires was known as the "Paris of South America." Now, however, Argentina faces a devastating financial crisis.

Argentina's peso has enormously lost its worth (further explained here) in large part due to government restrictions on its exchanges with the dollar. In response to this, the government quickly tried to loosen some of these restraints, but inflation is still high and the overall problem continues.

How should Argentina's government go about dealing with this hard time? In the past, Argentina has remained strong due to its agriculture, although there are currently disputes between the government and many farmers. Should the government insert more policies into the nation? Or should it count on its industry to bolster the value of the peso?

The article on loosening restrictions is here and a general summary of the problem can be found here

Voting "Rights"

As, one by one, all of us seniors reach our 18th birthdays, we hopefully entertain some thoughts of our impending voting rights. Just what those rights are is not as certain as we may think.

Today, a federal court upheld laws in Kansas and Arizona requiring citizenship proof if voters vote by mail. These law suits came after the U.S. Election Assistance Commission forbade states from requiring proof of citizenship. According to the Reuters article, "In his ruling on Wednesday, U.S. District Court Judge Eric F. Melgren, in Wichita, Kansas, said that because Congress had not outlawed proof of citizenship demands by states, the commission did not have the right to prevent Arizona and Kansas from adding such requirements to voter registration forms."

Image Source: voteks.orgI also find the statement of Arizona's Attorney General interesting:'"Today's decision is an important victory for the people of Arizona against the Obama administration, assuring that only Arizona residents, and not illegals, vote in Arizona elections,' said Arizona Attorney General Tom Horne, who filed the lawsuit along with Kansas Attorney General Kris Kobach."
"[A]gainst the Obama administration?" That seems like a very partisan statement. It doesn't seem like such political concerns should be a legitimate reason for changing voting rules. However, it is inevitable that politics get intermixed in any voting regulations. How much intermixing is acceptable, though? These laws are proclaimed to be an effort to reduce the voting of undocumented aliens and residents who aren't citizens. While there is certainly some merit to those efforts (or is there?), the question arises of whether the benefits outweigh the costs. 

Do you think that such voting laws are just Republican efforts to reduce voting by minorities? Or is that an unfair allegation? What is more of a problem: that non-citizens would vote or that citizens would be prevented from voting? 
Source

Toyota Fine: Too Far or Not Enough?

After a four year investigation, Toyota has been fined $1.2 billion dollars for concealing information about faulty car parts, especially sticky accelerators, while misleading costumers with regards to safety. This fine is the largest ever for a carmaker in the U.S. The company has also had to recall millions of cars, and paid $66 million dollars in civil lawsuits. However, these payments are tiny compared to Toyota's $66 billion in cash reserves. 

"There has been a growing sense among executives that a prolonged investigation would ultimately do more damage to the automaker’s image in the United States than a settlement, people with knowledge of the company’s thinking say."

While the investigation has not yet released the number of deaths directly caused by this faulty manufacturing, the fact that the company places more emphasis on avoiding a "prolonged investigation" than on protecting human life seems disturbing.

GM is currently also being investigated; in the wake of this outcome, will the fines be enough to deter other safety violations? Or should the penalties be even harsher?

Full article is here.

Low-Wage Workers Are Finding Poverty Harder to Escape

A recent report has been shown to suggest that low wage workers are finding poverty harder to escape this past decade more so than before. While President Obama has suggested that he wants the minimum wage to increase it still stands at a measly 7.25 an hour, which about 3.5 Million make. $7.25 is the federal minimum wage, so it different areas of the United States it may be more (but not less).  While one may think that most of the people making money at the minimum value maybe teenagers working summer jobs, a large portion of the workers making this low money are an older group often supporting families.

Here is the initial article,with the graph (which I was unable to post here ) http://www.nytimes.com/2014/03/17/business/economy/low-wage-workers-finding-its-easier-to-fall-into-poverty-and-harder-to-get-out.html?ref=us

“More than half of those who make $9 or less an hour are 25 or older, while the proportion who are teenagers has declined to just 17 percent from 28 percent in 2000, after adjusting for inflation, according to Janelle Jones and John Schmitt of the Center for Economic Policy Research.”

I think it’s insane to think that nearly 25 million workers in the United States make under $10.10 an hour. Some of these people may have received a college education to, unable to find jobs. I compare myself to these people who live under minimum wage, and although both my parents did not receive a college education, they make much more than the minimum wage of california.  My question to you is do you think that minimum wage should be increased? If yes, then why, and if no are there alternatives then other than increasing the wage to assist the lower class? Also, if incomes are increased how do you think this will affect the market?

Here is a more local supporting an increase:

http://www.sfgate.com/politics/joegarofoli/article/Thumbs-up-for-15-an-hour-minimum-wage-in-new-5321206.php

Here is showing both sides:http://www.chicagotribune.com/business/careers/ct-biz-0317-work-advice-huppke-20140317,0,6199470.column

Would you Sanction Sanctions?

Image Source: CNN Political Ticker

Economics and politics are intertwined. We all know it, but it can be nice to see some instances of this relationship in action.

In this case, the situation itself is not very positive. Tensions have arisen between Russia and Ukraine, with implications for the United States and the rest of the world. Although the situation itself is complex, one of the main reason's behind the conflict is the Ukrainian president's rejection of an EU economics deal, favoring instead a deal with Russia. The president's actions lead to Ukrainian protests and, in February, the president's flight to Russia. Today, Russia annexed the Crimea, an ethnically Russian part of the Ukraine. The rest of the world needs to decide what to do in response.

Interestingly, Americans are not overwhelmingly in support of most of Obama's proposed actions regarding Russia. They do support sanctions being placed upon Russia. However, in this inter-connected world, there is no such thing as a free lunch. Do the benefits of sanctions outweigh the costs? According to the Huffington Post article, sanctions may actually have more of a negative affect on Germany and Italy than on Russia. Sanctions would decrease the supply of oil, increasing the price (supply curve shifting to the left!).

So what do you think? Is the real issue here more of an economic or a political one? Should America sanction Russia? And why do you think Americans are so much more in favor of sanctions than they are in favor of other alternatives?

Links:
Russian Annexation of Ukraine
Background of Ukraine Conflict

Survey on Americans' opinions on Obama's proposed actions:
Washington Post Article
CNN Poll

March Madness forecasting: Is FiveThirtyEight 1 in 9 quintillion?

KYLE TERADA/USA TODAY SPORTS

I really could not resist posting about this. Nate Silver’s FiveThirtyEight posted its predictions for the NCAA tournament. Test Silver’s odds against your own? I highly encourage you to read the analysis methods, as Silver boasts an impressive record of “political prognostication.” But of course, please do keep the actual odds in the back of your mind—they really, really are not in your favor. And on that note, I suggest you buy a lottery ticket first.

Mayor Rob Ford: How did he get his job?

Since his election as the mayor of Toronto in 2010, Rob Ford (Campaign Profile) has become famous for a number of bizarre activities, ranging from excessive drinking and crack usage to starting an online war against Kevin Spacey. Toronto is unfortunately unable to remove him from office, although the city has restricted several of his powers. However, these insane antics did not start once he was elected; it was known that he had been arrested for a DUI and possession of marijuana during his run for office. Ford dealt with allegations of these crimes by simply denying the arrest had occurred.

How is it, that in the age of information, a man such as this one could become elected to office? Moreover, how is it possible that he can remain in office even after admitting he smoked crack? (Here)

A summary of all the allegations made against Mayor Ford is here.

More prison reform: Holder to propose reduced sentences for certain low-level drug offenders

Thursday, Attorney General Eric Holder will propose reduced sentences for certain low-level drug offenders. The proposal is expected to be approved and is predicted to affect 70 percent of drug offenders. The Justice Department says this will reduce the federal prison population by about 6550 inmates over the next five years and reduce the average sentence of a drug trafficking offender by 11 months.

Read more specifics in the article here.

Reuters

This is an expansion of Holder’s initiative to reform the treatment of drug offenders in the justice system. In August, Holder decried the injustice of mandatory minimum sentences and announced that low-level, nonviolent drug offenders without gang or cartel ties would not be subject to these mandatory sentences. Holder also made a point in August to note that America has incarcerated the largest proportion of its population out of any country in the world.

As in August, Holder has received mixed reactions. Civil liberties groups are generally supportive while others are skeptical of the attempts to reform the criminal justice system.

If you’re interested in the issue, the Atlantic has some great coverage of federal prison issues here and here.

It is my personal opinion that draconian punishment exacerbates the root of crime problems because it frankly isn't a deterrent to committing crimes. It must also be noted that a “low-level drug offense” on your record automatically closes the door for even productive reformative opportunities like more job prospects. I’m interested in the direction of this change. Holder seems to be pushing the initiative more, but the data will have to speak for itself later on. What are your thoughts on the nature of the prison system? Justice system? Reform?

Economic theory + sociology + psychology.... Warning: read carefully

Here’s an article about the idea of the “perfectly rational consumer,” which, according to the article, is a paradox. The perfectly rational consumer, who supposedly considers all variables surrounding their consumption, is irrational for aspiring to have the best of everything. The result is noticeable dissatisfaction with actual success in life. The article highlights some recently published papers that have poked a hole in the aspirations of perfectionists:

“The trouble with perfectionists is that, by wanting the best, they aspire to be perfectly rational consumers in a world where we all agree that's impossible. It's a recipe for dissatisfaction, way too much work, and even depression. “

And thus…

“Hard-earned success in life is wasted on the people least likely to appreciate it.”

In my opinion (I find this piece a bit comical), this article is a remarkable black-and-white oversimplification. In reality, theory presumes that the rational consumer will maximize the situation (not attempt to achieve perfection). And thus the article steps into obviously gross generalizations and logical fallacies. The takeaway: be wary of the analysis you read online that melds sociology/psychology inappropriately with economic theory.

Snowden calls for tech companies to act

Edward Snowden, the former CIA and NSA contractor who leaked classified information about the National Security Agency's wiretapping program, spoke at a Tech convention (SXSW) in Texas today via google hangouts. He had fled to Russia after leaking the NSA programs, and this was the first time he directly communicated with American citizens since then. Snowden strongly believes that people need to protect themselves from these government surveillance programs. He argued that tech companies must provide the public with encryption tools to block the NSA from looking into their private internet usage. Although tech geeks can easily protect themselves from the NSA by using complex encryption tools, the average person cannot. Snowden states that these average users should have the same protection as the tech geeks, and that tech companies need to provide them for the general public. He believes there needs to be both political change and a technological change. While the government hasn't made enough change to protect the public's privacy, he thinks tech industries can help fix the problem.

Ironically, at the same tech convention, other sessions were teaching entrepreneurs how to collect private data about users of their products, and using it for revenue. While Snowden speaks for American civil liberties, tech industries may be lured by the profit they can make by looking into private data.

The obvious question is, is this right for Snowden and Tech industries to do? Should this be seen as denying the government from protecting the country, or should this be seen as a righteous act of protecting civil liberties? Some say that the NSA has blocked many terrorist attacks through its surveillance programs, while others argue that the NSA is simply infringing on civil liberties by calling the act "national security." I personally think that it would be extremely dangerous if the general public has access to blocking the NSA, because then terrorist can easily bypass our national security. Also, should Snowden be involving private industries to fight the government's national security programs? Should tech industries use private data to profit?

CNN
NYTimes

Rate of uninsured at lowest since 2008, early signs of ACA impact?

Wednesday, the Obama administration announced that Americans will be able to keep old insurance plans for up to three years, even if they do not comply with Affordable Care Act standards. Though critics immediately saw this as another example of poor execution and administrative inconsistency (following the numerous changes to the ACA’s implementation), a recent Gallup poll might indicate a trend in the other direction. The uninsured rate is at the lowest it has been since 2008 and has declined significantly among lower-income individuals and Black Americans.

Though it is not certain as to whether the trend can be attributed to the ACA policies, it is likely that they have contributed some. Additionally, several of the law’s provisions have not gone into effect, including the requirement that employers provide health insurance to their employees by 2015-2016.

This continues the trend of data that Gallup reported in earlier months. Professionals have cautioned against speculation, as the drop in uninsured may be related to the political debate surrounding the ACA.

We’ll have to wait to see the real impact of the ACA. While the Democrats did suffer from initial implementation failures and indecisiveness, once more concrete data comes out, we may see some Republican states begin to waver as well: Greg Sargent of the Washington Post states, “We’re already seeing the GOP repeal stance begin to crack up as enrollment mounts and local GOP officials and GOP candidates embrace versions of the Medicaid expansion for their states; a continued fall in the uninsured could make it increasingly difficult for Republicans to continue pretending the law's beneficiaries simply don't exist."

This poses interesting questions for the upcoming midterm elections. What are your predictions? And what are your thoughts about the ACA as the data starts to roll in?

Mt. Gox Files For Bankrupcy Protection

 

Mount Gox was once one of the biggest bitcoin exchanges, now they are filing for bankrupcy protection after losing nearly half a billion dollars in bitcoins to a hack attack. Based in Tokyo,  Japan, Mount Gox exchanged bitcoins for currencys around the world including the US dollar.

Bitcoins are an interesting and confusing thing. They are form of online currency that you keep in a virtual "wallet". This "wallet" takes the form of an account that is made on a secure third party website. Bitcoins are more like stock than actual currency. The value of the bitcoin fluctuates like a roller coaster, it can reach as high as $1,242 (like late last November), or as low as $109 (like early October). Right now a single bitcoin is valued at $618.30. You can obtain bitcoins through a complex encrypted computer program. You must solve a complicated math problem to release new coins to the market. To mine bitcoins hue amounts of computing power is required.

 Bitcoins are not regulated by any central authority like the Federal Reserve, so any transactions made on the online marketplace are untraceable to the idividual. Due to the fact that the bitcoin is an untraceable currency it can be used to make illegal purchases. The Silkroad marketplace was an anonymous hidden online marketplace where illegal items could be purchased with bitcoin. Things as ridiculous as "Cocaine Energy Drink" could have been bought, until they were shut down by the FBI in early October of last year. You cannot use bitcoins on any store, only some stores will take bitcoins as currency. While they are untraceable to a certain person, there is an underlying software code called "the protocol" that keeps track of every transaction using a special marker on each bitcoin.

This link gives a pretty good explanation as to what bitcoins are, far better than I could at least.
http://abcnews.go.com/Technology/bitcoins-virtual-currency-explained-idiot/story?id=20926230

One major flaw of bitcoins is that if the server is as faulty as Mount Gox was they can be easily stolen by any experienced hacker. In addition, there are several countries that have decided to take action in regards to the virtual currency. Japan's government wants more regulation amid all of the hacking attacks on exchanges like Mount Gox, and they want to classify the bitcoin as a commodity. Russia has decided that anyone that uses bitcoins deserves to be on the "suspicious list". In the US, the IRS has not made bitcoins taxable, but it may soon with their growing popularity.

So what do you guys think about this whole bitcoin business? Its all kind of a confusing thing. Do you think that the US should take action against the bitcoins? Do you think that there should be some form of regulation seeing how dangerous this form of virtual currency can be? How do you think this will effect the dollar, and other physical currencies?

Heres some links
http://online.wsj.com/news/articles/SB10001424052702303801304579410010379087576
http://www.reuters.com/article/2014/03/07/us-bitcoin-mtgox-japan-idUSBREA2601Z20140307
http://english.cntv.cn/program/newsupdate/20140301/104182.shtml
http://www.nolo.com/legal-encyclopedia/bitcoins-tax-liability.html

New Jersey teen sues her own Parents

Unlike most of the other states, New Jersey Emancipation laws says that once a child a turned 18, a parents child support obligation does not end automatically. If either parent wants to be released from these obligations a court order must be entered. Then the court will decide from there whether or not they think the child is still in need for support or not.

A teenager in New Jersey named Rachel Canning has brought her parents to court with the claim that they kicked her out of her house and have refused to finance her high school, and college education. She asked the court to make her parents pay for her private highschool and college expenses, as well as transportation and living expenses. Also she wants them to pay for the legal fees from this case. So this would come out to a $650 weekly child support.

Both sides have their own stories, the parents claim that she: "took it upon herself to run away so that she could live her life without any parental supervision and without any rules." While she claims that she was forced to leave and she suffered verbal and physical abuse. Her parents have also said that she lied in her court filing and to child welfare workers involved.

So far the court has denied her the first round of her suit, with the judge saying that there was no emergency basis for Rachel to ask for the money.
 "What will the next step be? Are we going to open the gates to a 12-year-old suing for an Xbox?"-Judge Peter Bogaard

So what do you think of this case? Who do you think is in the wrong? Do you think that Rachel should get the money under the NJ Emancipation law?

Here's some Links
http://www.bbc.com/news/blogs-echochambers-26441941
http://www.cnn.com/2014/03/04/justice/student-sues-parents-new-jersey/
http://www.huffingtonpost.com/2014/03/04/rachel-canning-suing-parents_n_4899542.html
http://www.weinbergerlawgroup.com/children-parenting/child-support/emancipation-legaladults.aspx

Senate blocks bipartisan bill to remove military commanders from sexual assault cases

(Douglas Graham/CQ Roll Call File Photo)

Today, the Senate blocked a bipartisan bill that would have introduced major changes to the way the military handles sexual assault cases by removing commanders from the prosecutorial decision-making process for sexual assault cases. Democratic Senator Kirsten Gillibrand from New York sponsored the bill, which received 55 of the 60 votes necessary to limit debate. Opposition to the bill was led by Republican Senator Claire McCaskill of Missouri who argued that this would do little to address the problem of sexual assault in the military and would weaken the military chain of command.

Three months ago, Congress also passed reforms to the military’s handling of sexual assault cases, including ending the statute of limitations for sexual assault or rape cases and preventing military commanders from overturning jury verdicts on such cases. Read Susan’s post here or more information/discussion on that.

The military sexual assault issue is extremely complicated. I’d rather not get into the nitty-gritty of that, but there have been numerous high-profile cases against military officials. Even today, it was reported that the Army’s top special prosecutor was placed under criminal investigation for assaulting a woman in 2011.

The bipartisan nature of the bill is very interesting. I am sure a more in-depth analysis of the vote will come out soon, but it is also noteworthy that the vote will have an impact with more hardline Republicans. Senator Lindsey Graham, Republican from South Caroline, warned that the votes infavor of the bill might not bode well for 2016 GOP hopefuls.

I’m sure there will be a lot more about this in the coming days, but as it stands, what do you guys think about the current political debacle/the future direction of this debate?

CollegeBoard announces new SAT

David Coleman, President of the College Board, announced changes to the SAT test, criticizing the SAT and rival ACT for being out of touch with student high school work. The new exam is set to roll out in 2016 and will be moved back to a 1600 scale.  It will features an “evidence-based reading and writing” section and a mathematics section. The new test will have an optional essay that will focus on analytic skills as well as writing. Coleman also stated that the vocabulary section will be toned down to feature less esoteric vocabulary. Coleman also noted that the test would now feature more demanding problem-solving, as well as the potential to have students include written justifications for some answers.

Rui Vieira/Press Association

In my opinion, this shift will make the SAT less formulaic but this will also increase the difficulty of the test. Coleman came directly to the College Board after previously working on the new Common Core education standards rollout—Common Core also focuses on more evidence- and knowledge-based approaches to problem solving, and many of these new changes seem to reflect that similar approach. Noting that the SAT has been losing ground to the ACT for quite some time and that there is significant dissatisfaction with standardized testing in general and particularly relating to college admissions, I doubt that this test will attract more test-takers; it may dissuade many students. However, I personally do believe that this new test may be a better reflection of actual academic performance, as it reflects an approach more oriented towards analysis and problem solving rather than the regurgitation of surface-level knowledge.

And on a final note, Coleman also announced that the College Board will be partnering with Khan Academy to develop free online test preparation materials. Income-eligible students will also receive wavers to apply to four colleges free.

What do you think? Is it a step in the right direction as far as making standardized testing better assessments of students’ abilities to perform in school/college? Is that even the direction the SAT should be heading, or should it continue to be a more formulaic assessment? What’s the purpose of standardized testing anyhow? And what do you think about the new test prep? Good, bad, more of the same?

Crimea crisis update: Russian saber rattling continues

Here’s an update on the shifting landscape in Crimea…

RIA Novosti/Reuters

Today, Russian President Vladimir Putin held an unscripted press conference to discuss the ongoing crisis in Crimea. Putin’s description of the crisis was almost entirely at odds with the version presented by the United States and many of Europe’s leaders. Putin restated his support for the ousted Ukrainian President Viktor Yanukovych and stated that the Russian presence in Crimea was in complete accordance with international law and agreements with Ukraine. Earlier today, Russian troops at the hotly contested Belbek military institution in Crimea fired warning shots at Ukrainian soldiers who were attempting to return to their positions. And meanwhile, it has been reported that Russian special forces have been inserted into the region (in addition to the already reported 16,000 troops).

While Putin’s statements this morning did little to ease the tension (or even attempt to), he did make some interesting comments regarding annexation…

“We are not considering this possibility,” he said. “It’s up to people living in a certain territory, if they can exercise their free will, and determine their future. For example, if Kosovo’s Albanians were allowed to do that, self-determination, which according to U.N. documents is a right, but we will never instigate it, never support such trends.”

Putin actually seems to have stuck his foot in the door for that discussion. And, noting that 58 percent of Crimea’s 2 million people are ethnic Russian and that many more have Russian citizenship, his brand of logic would likely not consider this preposterous. Basically, it’s complicated.

In Secretary of State John Kerry’s recent visit, he condemned Putin’s actions. The responses from United States officials has been varied; economic sanctions have even been brought to the table. But the bottom line is that the US seems to have little bargaining power besides the force of a public condemnation of Russia’s actions. Economically, Europe brings far more to the table than we do—we’re not one of Russia’s major trading partners, and Europe is hesitant to impose economic sanctions. To many, it seems that anything short of actual US military intervention would have little impact.

All this is made a bit more interesting because of Russia’s declining economic predicament. In the background of the Crimea chaos, the Bank of Russia raised interest rates from 5.5 percent to 7 percent the other day (its largest increase since the 1980s) in an attempt to keep foreign capital in the country. Furthermore, as Matthew Klein of Bloomberg View notes, European demand for natural gas has declined since 2010 and Russian oil production costs have risen as oil prices remain flat. The idea that Putin is using this to drag attention from Russia’s larger economic problems is tossed around in the article.

TLDR: Putin’s antics leave much to speculation with the ongoing crisis, but the showiness of Russian saber rattling may in fact be hiding more beneath the surface…. I'll leave this discussion open to whatever direction anybody takes.

Belgium King Signs Euthanasia Bill

 

Yesterday the King of Belgium signed a bill allowing the use of euthanasia on chronically ill children. This highly controversial bill was passed in mid Febuary, and was awaiting the signature of the King to become in complete effect. With the passing of the bill, this makes Belgium the first country in the world to allow euthanasia with no age restrictions. The law passed the Belgium Parliament with 86 for the bill, 44 against, and 12 abstenations.

This legislation allows for children to request euthanasia if they are "in great pain' and there is no treatment available. To carry out the procedure, the child must seek permission from the doctor, parents, and psychiatrists. This makes Belgium one of two countries to allow the doctor assisted suicide under 18. The other being Netherlands with an age restriction of 12.

A controversial bill like this definetely tugs about the morality strings of politics. Do you think that children should be allowed to make this decision? Seeing as Belgium passed this bill do you think that this might lead other countries to do the same and lower, or possibly remove restrictions, completely ?

Heres some Articles
http://www.bbc.com/news/world-europe-26181615
http://rt.com/news/belgium-king-sign-euthanasia-bill-566/
http://www.cnn.com/2014/02/13/world/europe/belgium-euthanasia-law-children/

Giffen Goods Are Real

Rare, but apparently someone has found a proper example of the law of demand failing, distinct from the luxury "Veblen good" category. From an Economist blog in 2007:

These “Giffen goods” show up in every introductory economics textbook as a freak case when the law of demand fails… Jensen and Miller look at poor Chinese consumers and demonstrate that they consume more rice or noodles, their staples, as prices go up…. People need a certain amount of calories to survive—let’s say 1600 per day. You can either get that by consuming rice and perhaps some vegetables alone, or by eating rice, vegetables and a few bites of meat.But meat is expensive. As the price of rice goes up, these poor Chinese can no longer afford the luxury of cooking meat, yet they still need to get to their 1600 calories. So they eat rice instead, which is still relatively cheap compared to meat. Voila!: Giffen behaviour in action.What does this mean for the real world? Prices of certain food crops have increased by as much as twofold over the last 18 months, which has lots of negative consequences for the world’s poor. One such consequence might be that demand for staples has gone up even further.

Quoted from http://www.economist.com/blogs/freeexchange/2007/07/as_price_goes_up_so_does_deman